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November 19, 2009

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Home » Business » Auto

Continental tapping into demand for affordability

GERMAN tire and car parts maker Continental AG yesterday opened a new research and development facility in Shanghai, aiming to further boost business through products and solutions customized for the Chinese market.

The facility in Yangpu District in northeast Shanghai, where the company has its Asia headquarters, will have 900 engineers by early next year, focusing on the design and development of vehicle electronics, Jay Kunkel, president of Continental Asia, said yesterday.

It is part of Continental's 60 million euro (US$65 million) investment in China, which also includes a technical center in Jiading District responsible for vehicle development and system testing.

Kunkel said the increased localization would enhance Continental's cooperation with more Chinese car makers and fit its own strategy on the market for "affordable cars" across the world.

"Our approach is to work with customers in the vehicle development stage and the new facility would enable us to understand more about the market," he said.

As global profits continue to slide due to slow demand, the maker of tires, brakes, electronics and other auto components sees opportunities in China.

It also said Chinese car makers were very demanding over new technologies as they had aggressive export plans and were racing to develop new-energy vehicles.

The new technical center will develop power electronics and hybrid control units for such vehicles.

Continental estimates a minimum of 25 percent of its global sales will be achieved in Asia by 2013 with more than 50 percent in China, Kunkel said.

Over the next six years, about 20 percent of vehicles would be affordable vehicles that are the result of lowered costs throughout the engineering and manufacturing process, he said.


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